DTN Oil Update
WTI Below $100 as Iran Allows More Ships Through Hormuz
SECAUCUS, N.J. (DTN) -- Crude and product futures tumbled their most in two weeks Wednesday on reports of more tanker traffic on the Strait of Hormuz as European governments were said to be in direct negotiations with Iran to secure safe passage for vessels navigating the waterway.
Iran's military said it had let 26 ships through the key chokepoint for oil over the past 24 hours. That contrasted with the near zero in recent weeks amid blockades by both Iranian and U.S. forces on different points of the strait. The Hormuz in normal times saw about 140 ships crossing daily, carrying a total of about 20 million bpd in petroleum liquids.
NYMEX WTI crude for July delivery settled down $5.89 at $98.26 bbl for a 6% drop on the day, the sharpest since May 6. The session low was $96.94.
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ICE Brent crude for July delivery also closed down about 6%, dropping $6.26 to $105.02 bbl, after an intraday bottom at $ 103.24.
Among refined products, NYMEX ULSD for June delivery slipped $0.2154 to $3.9471, while front-month RBOB retreated by $0.2088 to $3.4874 gallon.
The U.S. Dollar Index edged lower by 0.201 points to 99.065 against a basket of foreign currencies.
Aside from the relative ease for shipping on the Hormuz, energy prices also fell on reports that U.S. President Donald Trump had spoken to Israel Prime Minister Benjamin Netanyahu about his intent to end their joint military campaign against Iran, even as the Israeli leader had wanted the offensives to continue.
Trump told reporters that negotiations with Iran were "in the final stages" but also warned of further attacks if Tehran did not agree to a peace deal. Iran responded by saying it would extend the current war beyond the Middle East if strikes resumed on its territory.
The bearish energy market tone was balanced somewhat by inventory data from the U.S. Energy Information Administration showing commercial crude stocks down a fourth consecutive week last week while distillate fuel inventories remained near 20-year lows.
Domestic commercial crude inventories plunged by 7.9 million bbl during the week ended May 15, sliding to 445 million bbl. The latest balance sits at 1.9 million bbl, or 0.4%, higher than the matching frame from a year ago.
Distillate fuel stocks edged up by 400,000 bbl to 102.9 million bbl for the reporting period. Despite the modest weekly build, this volume marks the third-lowest distillate inventory level recorded since the week concluding July 4, 2005.
Total motor gasoline inventories dropped by 1.5 million bbl to finish the week at 214.2 million bbl. The current contraction brings gasoline reserves down to their lowest point since the week ended November 28, 2025.